Amylin sues partner over competing diabetes drug

Amylin Pharmaceuticals’ nine-year partnership with Eli Lilly to sell its diabetes drug Byetta turned hostile Monday when the San Diego company accused the Indianapolis drug giant of anti-competitive behavior and contract violations in a lawsuit filed in San Diego federal court.

The dispute is over Lilly’s agreement to market linagliptin, a new type 2 diabetes pill also known by the brand name Tradjenta that was approved by the Food and Drug administration on May 5.

Lilly disputed the claims.

“We emphatically reject the allegation that we did not meet our contractual obligations under the Lilly and Amylin alliance,” said Enrique Conterno, president of Lilly’s diabetes division.

Shares of Amylin fell 69 cents, or 5 percent, Monday to $12.97.

Linagliptin was taken into late-stage development by Boehringer Ingelheim before the German drugmaker entered into an alliance with Lilly in January to develop and sell that drug and other potential therapies in Boehringer’s diabetes portfolio.

In its lawsuit, the San Diego company says the new deal represents a breach of its earlier contract with Lilly because linagliptin will compete directly with Amylin’s type 2 diabetes drug Byetta, which is also known as exenatide.

“Amylin alleges that Lilly is engaging in improper, unlawful and anti-competitive behavior in the manner in which it plans to implement its recently announced global alliance agreement with Boehringer Ingelheim,” Amylin said in a statement Monday.

“Amylin selected Lilly as a partner to promote development and maximize sales of Amylin’s exenatide products,” the company said. “We are disappointed that we could not resolve this matter amicably and that we were forced to bring legal action to protect our rights, our products and our shareholders.”

The company asked the court to bar Lilly from using the same sales force that sells Byetta from also marketing linagliptin.

Lilly said in a statement that its alliance with Boehringer encourages competition in the diabetes drug market and ultimately benefits patients by helping to provide them with more treatment options.

Amylin’s drug, which must be injected twice a day, has been losing market share to competitors that require less frequent injections. As a result, Amylin has been under pressure to get a longer-lasting version of Byetta onto the market.

Sales of Byetta continued to slide in the first quarter, dropping to $128 million from $136.4 million a year earlier.

A weekly injectable version of the drug, dubbed Bydureon, was rejected in October by the FDA, which told the company to conduct a new study of how the medication affects the heart.

A new clinical trial was started in February, and results should be reported in time to resubmit the drug to the FDA in the second half of the year.

Amylin is developing Bydureon in partnership with Lilly and Walthman, Mass., drug developer Alkermes. The San Diego company said it remains committed to that collaboration.

Patients taking Tradjenta, the newly approved diabetes drug being sold by Lilly and Boehringer, must take four of the capsules three times a day for at least six months.